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Strategies & Market Trends : Value Investing

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To: Michael Burry who wrote (7525)	6/10/1999 8:54:00 AM
From: jeffbas	Read Replies (1) of 78666

For what it is worth, I would be inclined to buy CHB over CMH, on slightly different reasoning. These companies tend to move as a group when they move. They have not moved for a long time so the price relationship between the two (or FLE, or OH, for that matter) has had a chance to adjust to true values (whatever that is). They are all pretty good values and it is likely splitting hairs as to which one is better. However, when they do move, I would want to own the perceived leader, CHB. As a corollary, I think the above suggests that we should perhaps be asking ourselves different questions. Do we want to invest in the manufactured housing industry now and if so why. A friend of mine who is quite knowledgable on the industry had two comments -- interest rates and new capacity and too many dealers. The former affects interest in buying the group, even if it does not affect fundamentals that much. The latter affects margins. He is not pounding the table to put new money into the industry.

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